Dothan, Alabama
111 Adris Place
Dothan, AL 36303
(334) 673-0100

3 Different Types of Creditor Claims in Bankruptcy July 23, 2018

Dothan, Houston
3 Different Types of Creditor Claims in Bankruptcy , Dothan, Alabama

If you are filing for bankruptcy, not all your debts will be treated the same. The way the court handles debt depends on whether it is a secured, unsecured, or a priority claim. Here is a brief guide to each type of creditor claim to help you prepare for the first consultation with an attorney.

Secured Claim

This is where a creditor places a lien on your property. Common examples of this type of claim include mortgages, property taxes, and car loans. While bankruptcy can remove your liability for these debts, it can’t get rid of the lien. If you don’t pay the debts, the creditors can take the asset away from you.

Unsecured Claim

bankruptcyWith an unsecured claim, the creditor doesn’t have a lien against your property. Credit card bills, personal loans, and medical bills are common debts that fall into this category. You can also eliminate them in bankruptcy. One example of unsecured debt is a student loan. However, unless you can prove that paying these loans would cause extreme hardship, you cannot have them discharged in a Chapter 13 or Chapter 7 bankruptcy. 

Priority Claim

This refers to unsecured debts that can’t be discharged through bankruptcy, such as alimony, child support, and tax obligations. You must pay these before other creditors. While you can’t wipe out these debts, you can arrange a repayment plan through Chapter 13 bankruptcy. 

 

Filing for bankruptcy can involve many complexities. The experienced attorneys at The Gil Law Firm in Dothan, AL, will help you through the process. This law firm opened its doors in 2000. Their attorneys will simplify your case and get you on the road to financial recovery. Besides bankruptcy law, they also specialize in Social Security and personal injury. To request a consultation, call (334) 673-0100. Visit their website for more information about their practice areas.

Other Announcements, Events and Deals from The Gil Law Firm
How to Talk to the Claims Adjuster After a Car Accident Injury, Dothan, Alabama
If you were hurt in a car accident that wasn't your fault, you may have grounds for a personal injury claim. Since insurance adjusters are trained to find even the smallest reason&nb...read more
What’s the Difference Between SSI & SSDI?, Dothan, Alabama
For individuals living with a disability, receiving financial benefits through applicable programs can make all the difference in maintaining a good quality of life. The Social Secur...read more
What Does a Bankruptcy Trustee Do?, Dothan, Alabama
Individuals who file Chapter 7 or Chapter 13 bankruptcy are expected to cooperate with their assigned trustees. This person oversees and represents the estate in question, so it...read more
What Mental Impairments Qualify for SSDI Benefits?, Dothan, Alabama
The Social Security Administration awards disability insurance benefits to individuals suffering from mental disorders as well as physical disabilities. In both cases,...read more
How to Build a Strong Slip & Fall Case, Dothan, Alabama
If you were recently involved in a slip-and-fall accident, you might be interested in filing a personal injury claim. The law protects victims in these cases, but before you can...read more